What Can You Do After Being Fired Without Cause In Ontario? Your Head Might Be Spinning, But Understanding Your Rights And Your Employer's Obligations Is The First Step Forward.

by John Bonn
Employee rights and employer obligations are outlined in ESA

You arrive at work just like you have every other day for the last ten years. You sit down at your desk and fire up your computer, ready for another super-productive day. Before you get yourself logged in, the boss calls and asks you to come over to her office. You arrive, and seated beside her is the Human Resources director.

They have that certain look on their faces that leads you to think, “Well, this isn’t good.”

What happens when you are dismissed from your job?

Your boss tells you to sit down, and without wasting any time says something to the effect of, “The company is heading in a different direction,” or “This just isn’t working out anymore,” and tells you that your employment has been terminated. The HR director hands you an envelope, telling you to take the rest of the day off with pay, and that the details of your “package” are in the letter she just handed you.

Your head is spinning – you did not see this coming. Your performance has been stellar, with no complaints or discipline on your record. You have received regular bonuses and frequently receive compliments on your hard work and excellent manner with customers and other staff. “How could this happen?” you ask yourself. “What am I going to do now?”

Can your employer dismiss you without cause?

The quick answer is, “Yes.” In Ontario, any employer can dismiss an employee from their job for any reason, or for pretty much no reason. That said, when an employer “fires” someone, the employer has certain obligations.

Employee rights and employer obligations.

 In most cases, a dismissed employee is entitled to a period of notice in advance of the termination of their job (subject to some exceptions). If the employer does not want to give advance notice, then they have the option of simply paying the amount of money that the employee would have earned during that notice period, and making the dismissal effective immediately.

Deciding how much notice you should get isn't clear cut. 

How much notice should you get? Well, it depends. The Employment Standards Act (the “ESA”) tells us that most employees in Ontario are entitled to at least one week of notice per year of service. For example, an employee who is entitled to notice, and who has been employed at the same company for three-and-a-half years, is entitled to at least three weeks of notice under the ESA. The exception is the employee who has been employed for less than one year – that person is entitled to one week. For longer-term employees, the ESA only specifies the notice period for employees whose “period of employment is eight years or more,” and does not go beyond that – and yes, you guessed it – that notice period is at least eight weeks.

"At least" one week per year of service.

 Take a look at the above wording – words are important. Notice the “at least” wording. If you think these words suggest that maybe it is not as simple as a “one week per year of service up to a maximum of eight weeks” rule, you are right.

In 1960 the Ontario Court of Appeal decided that the periods of notice set out in the ESA are only minimums and that a dismissed employee is entitled to “reasonable notice”. So what does that mean? Fortunately, the Supreme Court gave us some guidance as to what should be considered in determining what is reasonable notice. Recognizing that every case is different, the Court said that the following criteria are to be considered when determining what an appropriate amount of notice should be, in any given case:

  • The length of the employee’s service with the employer
  • The employee’s age
  • The employee’s level of responsibility within the organization
  • The availability of similar work within a reasonable distance

Essentially, the Court said that the amounts of notice outlined in the ESA are to be considered as minimums and that the four criteria above should be used to determine what is appropriate. The notice period decided upon on these criteria is referred to as the common law notice period.

What else might you be entitled to after being dismissed from your job?

 In some circumstances, you might be entitled to a further payment under the ESA. This payment is called “severance” and is a different thing from pay-in-lieu of notice. Not every employee is entitled to severance. Typically, it applies when a person is dismissed from a large employer. An employee is only entitled to [i]severance if s/he was employed by the employer for five years or more and:

  1. The severance occurred because of a permanent discontinuance of all or part of the employer’s business at an establishment and the employee is one of 50 or more employees who have had their employment relationship severed within a six-month period as a result; or
  2. The employer has a payroll of $2.5 million or more.

Generally speaking, the amount of severance works out to about one week per year of service, and there is no upper limit.

Being dismissed can leave you spinning, but you have rights. 

 Losing a job can be a very difficult time for anyone. In addition to sorting out the required notice period, there are other issues to be aware of, such as potential violations under the Ontario Human Rights Code, the status of benefits, effects on pensions, and so on. One complicating factor in deciding what your appropriate compensation should be when you lose your job is whether or not you signed an employment agreement when you were hired.

More and more, employers are giving employees employment contracts that contain very specific wording around entitlements at the time of a without-cause dismissal. Your rights under the ESA and under the common law can be seriously affected by the wording of the termination clause in that contract. It is important to fully understand the effect of a termination clause before you sign an employment contract.

We can help you assert your rights as an employee.

If you are about to be hired and have received an employment contract to sign; or, if you have been fired, and are not sure of your rights, consider giving us a call at Bonn Law. We can give you our initial thoughts and help you decide whether or not your employer has treated you fairly, or whether you might want to take further steps to assert your rights. We would be happy to speak with you.